As Washington wrestles with budgetary crisis, no one seems willing to confront an uncomfortable question: if we’re considering going back to tax rates of the Clinton era, why not simultaneously reinstate spending rates of the Clinton era?
When Slick Willy left office, the government collected 21 percent of the GDP in taxes; next year, we’re projected to take in 18 percent in taxes, a relatively modest decline. But spending has increased far more sharply: from 18 percent of GDP all the way up to 23 percent. In other words, even if we go back to Clinton’s higher tax rates-not just for rich people, but for everybody-we’d still face dangerous deficits if we maintained the same levels of reckless spending.
Nostalgia for the prosperous Clinton era should encourage consideration for the much lower spending that the Republican Congress of those years fought to achieve.